AT&T's Mexico unit loses class action lawsuit to consumer watchdog

MEXICO CITY (Reuters) - Mexico’s consumer watchdog, Profeco, said on Friday it won a class-action lawsuit against the local unit of U.S. telecommunications giant AT&T Inc for undue charges and poor service.

Profeco said that in 2013 it sued telecommunications operator Nextel, which was acquired by AT&T in 2015, for undue charges, changing rates without informing customers and continuing to charge clients for services that had been canceled.

Nextel offered 4G technology on its website though “it was proven in court the technology provided was inferior to what was advertised, underscoring the use of abusive and false advertising to prompt consumers into mistakenly acquiring their services,” Profeco said in a statement.

Profeco said AT&T, Mexico’s third-largest mobile service provider, “must pay damages to its affected consumers, plus 20% compensation and an additional 9% annual legal interest, for the various undue charges.”

It did not estimate how much that could mean AT&T will have to pay.

The sentence is final after Mexico’s Supreme Court rejected a prior appeal filed by the company.

“These trials began well before AT&T entered the market, as part of a class action suit presented against all wireless companies in Mexico, including Nextel, which we acquired in 2015,” AT&T said in a statement. “We continue working to serve our customers in better ways.”